GAINS EXTENDED

Sentiments remained bullish in the morning trade with markets hitting 10-1/2-week highs, extending gains for the fourth straight session on continued buying by funds and retailers amid a firming trend in Asian markets. Moreover, hopes of easing liquidity in the market after the RBI cut cash reserve ratio by 0.50 percentage point in its policy review on Tuesday too buoyed the sentiment. Though, the US markets closed lower on Thursday, after new home sales fell unexpectedly in December and dropped 6.2% to a record low in 2011. Back home, BSE's -- Sensex -- and NSE's -- Nifty - inching towards their crucial, 17,200 and 5,200 mark respectively, supported by index heavyweights Reliance Industries, Infosys and L&T. However, the index came off early day's high on profit booking, led by SBI and ONGC. ON sectoral front, metal witnessed the maximum gain in trade followed by consumer durables and technology while, banking and healthcare remained the only losers on the BSE sectoral space. The broader indices were going neck to neck with benchmarks. The market breadth on the BSE was positive; there were 1,184 shares on the gaining side against 445 shares on the losing side while 52 shares remained unchanged.

The BSE Sensex opened at 17,201.33; about 124 points higher compared to its previous closing of 17,077.18, and has touched a high and a low of 17,258.97 and 17,166.20 respectively.

The index is currently trading at 17,198.95, up by 121.77 points or 0.71%. There were 22 stocks advancing against 8 declines on the index.

The overall market breadth has made a strong start with 70.43% stocks advancing against 26.47% declines. The broader indices were trading inline with benchmarks; the BSE Mid cap and Small cap indices surged 0.65% and 0.90% respectively.

The top gaining sectoral indices on the BSE were, Metal up by 2.27%, CD up by 1.58%, TECk up by 1.26%, IT up by 1.26% and Oil and Gas was up by 1.06%. While, Bankex down by 0.35% and HC was down by 0.27% remained the only loser on the index.

The top gainers on the Sensex were Sterlite Industries up by 3.29%, Hindalco up by 3.10%, Sun Pharma up by 2.69%, Tata Steel up by 2.28% and Tata Motors was up by 1.89%.

On the flip side, HDFC was down by 1.35%, SBI was down by 0.48%, Wipro was down by 0.39%, Maruti Suzuki was down by 0.37% and HDFC Bank was down by 0.20% were the top losers on the Sensex.

Meanwhile, the International Monetary Fund (IMF) in its World Economic Outlook (WEO) has said that the euro area would fall into a mild recession in 2012 after the euro area crisis entered a "perilous new phase" toward the end of last year. This is likely to affect other parts of the world including the emerging and developing economies (EDEs). The report said in 2012-13, growth in EDEs is expected to average 5¾ %, and about ½ percentage point lower than projected in the September 2011 WEO.

The slowdown is expected to be due to the deterioration in the global environment, as well as the slowdown in domestic demand in key emerging economies. However, Asia is still projected to grow most rapidly at 7½ percent on average in 2012-13. Growth projections for India have also been lowered. Indian economy is expected to grow at 7 % this year and 7.3 % in 2013. Both figures are lesser than its September estimates of 7.5% and 8.1% respectively.

The report suggests that in emerging and developing economies, the near-term focus should be on responding to moderating domestic demand and slowing external demand from advanced economies, while dealing with volatile capital flows. Those economies that suffer from both relatively high inflation and public debt, including India and various economies in the Middle East, may need to take a more cautious stance on any policy easing.

On the whole, global output is projected to expand by 3.3% in 2012, substantially lower (-0.7%) than its estimates in the September WEO.

The S&P CNX Nifty opened at 5,216.75; about 58 points higher compared to its previous closing of 5,158.30, and has touched a high and a low of 5,217.00 and 5,177.45 respectively.

The index is currently trading at 5,184.50, higher by 26.20 points or 0.51%. There were 34 stocks advancing against 16 declines on the index.

The top gainers of the Nifty were Sesa Goa up by 6.48%, Hindalco up by 3.31%, Sterlite Industries up by 3.21%, SAIL up by 3.10% and Sun Pharma up by 2.65%.

On the flip side, Dr Reddy down by 5.41%, Ranbaxy down by 4.09%, PNB down by 1.47%, IDFC down by 1.43% and HDFC down by 1.30%, were the major losers on the index.

Asian markets were trading mixed; Jakarta Composite was up 5.56 points or 0.14% to 3,988.99, Straits Times was up 0.34 points or 0.01% to 2,894.77 and Seoul Composite was down 0.57 points or 0.03% to 1,957.75.

On the flip side, Nikkei 225 was down by 17.22 points or 0.19% to 8,832.25 and Hang Seng was down by 7.18 points or 0.04% to 20,431.96.